A tow truck driver's disability leave sparked a legal showdown over whether his employer's finances could excuse a demotion. Ontario's top court sided mostly with the worker but slashed the damages award over how the company treated the truck and phone he used on the job.
In an August 10, 2026, decision, Justice L.B. Roberts of the Court of Appeal for Ontario, writing for a panel including justices Favreau and Rahman, upheld a Superior Court finding that a former road boss at a towing company was constructively dismissed rather than lawfully let go through frustration. The 22-month notice period stood, but the court cut $125,640 from damages, reducing them from $236,163.77 to $110,523.77.
The employee had worked at the towing company for about 17 years, most recently as road boss, when he went on long-term disability leave in May 2020 after emergency surgery. His physician recommended modified duties, including no heavy lifting above 30 to 40 pounds and no work at heights, and later suggested a trial return under the same restrictions.
During his absence, the company's co-owners took over his road boss duties. Meeting with him in September 2021, they said the role had been eliminated for financial reasons and that he would return as a tow truck driver at lower pay, with eight weeks at his former pay level. The company confirmed the change in a letter that January.
The employee said he did not accept the demotion or pay cut and...
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